By conducting independent and objective audits, evaluations and investigations,
we inspire public confidence in the integrity and security of SSA's programs
and operations and protect them against fraud, waste and abuse. We provide timely,
useful and reliable information and advice to Administration officials, Congress
and the public.

Authority

The Inspector General Act created independent audit and investigative units,
called the Office of Inspector General (OIG). The mission of the OIG, as spelled
out in the Act, is to:

Conduct and supervise independent and objective audits and investigations
relating to agency programs and operations.
Promote economy, effectiveness, and efficiency within the agency.
Prevent and detect fraud, waste, and abuse in agency programs and operations.
Review and make recommendations regarding existing and proposed legislation
and regulations relating to agency programs and operations.
Keep the agency head and the Congress fully and currently informed of problems
in agency programs and operations.

To ensure objectivity, the IG Act empowers the IG with:

Independence to determine what reviews to perform.
Access to all information necessary for the reviews.
Authority to publish findings and recommendations based on the reviews.

Vision

We strive for continual improvement in SSA's programs, operations and management
by proactively seeking new ways to prevent and deter fraud, waste and abuse.
We commit to integrity and excellence by supporting an environment that provides
a valuable public service while encouraging employee development and retention
and fostering diversity and innovation.

Our objective was to determine the number of concurrently entitled individuals
who received excess Supplemental Security Income (SSI) payments as a result
of an unearned income computation error.

BACKGROUND

The Social Security Administration (SSA) pays disability benefits to eligible
individuals through two programs: Old-Age, Survivors and Disability Insurance
(OASDI), which provides benefits to wage earners and their families in the event
the wage earner retires, becomes disabled, or dies; and SSI, which provides
payments to financially needy individuals who are aged, blind, or disabled.
Individuals eligible for benefits under OASDI who also qualify for SSI (concurrent
beneficiaries) can receive SSI payments as long as the combination of benefits
does not exceed the Federal Benefit Rate (FBR), plus a $20 allowance. The FBR
increases with the automatic Cost-of-Living Allowance (COLA) applied to Social
Security benefits. The 2009 COLA increased both OASDI benefits and the FBR by
5.8 percent, the largest percentage increase since 1982. Effective January 2009,
the FBR is $674 for individuals and $1,011 for couples. Some States supplement
Federal SSI payments with additional benefits. In some of these instances, SSA
issues a single payment that includes both the Federal SSI amount and the applicable
State supplement. States must reimburse SSA for the supplement amounts.

SSI payments are reduced, or offset, by a recipient's countable income, less
certain allowances. SSA first offsets countable income against the FBR. If State
supplemental benefits are involved, and countable income exceeds the FBR, SSA
then offsets any remaining excess income against applicable State supplemental
amounts. For example, a concurrently entitled beneficiary receives a $750 monthly
OASDI payment and has no other countable income. The beneficiary lives in a
State that provides a $250 SSI supplemental benefit. The beneficiary's $194
SSI payment is computed as follows.

During our review of Benefit Payments Mailed to Post Office Boxes, we identified
47 individuals with 2 different Social Security numbers (SSN), who received
OASDI benefits under 1 SSN and SSI payments under the other SSN. Our review
of related payment records revealed that SSA incorrectly offset SSI payments
using OASDI benefit amounts that were not adjusted to reflect recent COLA increases.
These payment computation errors resulted in approximately $41,000 in excessive
SSI payments to the 47 individuals. An SSA representative informed us this error
was due to a systems interface problem that is known to occur when individuals
receive both OASDI and SSI under more than one SSN.

In March 2009, we obtained SSA payment data from 1 of 20 payment record segments
and identified 338 cases where OASDI benefit amounts used in a concurrently
entitled individual's SSI unearned income offset computation were less than
the amount of OASDI benefits SSA actually paid the beneficiaries. Our review
focused on these 338 cases. See Appendix B for a discussion of our scope and
methodology.

RESULTS OF REVIEW

We estimate SSA issued overpayments to approximately 6,800 concurrently entitled
beneficiaries as the result of an SSI unearned income computation error. In
March 2009, we identified 338 concurrent beneficiaries from 1 of 20 payment
record segments, who received excessive SSI payments because SSA erroneously
offset their SSI payment using OASDI benefit amounts that were not adjusted
to reflect recent benefit payment increases. SSA overpaid these beneficiaries
$18,604 per month in Federal SSI payments and another $2,557 per month in State
supplemental benefits as a result of these errors. Most of these errors involved
instances where SSA was collecting OASDI overpayments from the beneficiaries.
A systems input intended to prevent double counting unintentionally froze the
OASDI benefit amounts used in subsequent SSI unearned income offset computations.
If these errors are not corrected, we estimate that SSA will issue approximately
$5.1 million in excessive SSI payments to these beneficiaries over the next
12 months.

OVERPAYMENTS TO CONCURRENT BENEFICIARIES IN OUR POPULATION

We identified 338 concurrent beneficiaries from 1 payment record segment whose
March 2009 SSI unearned income offset computation used OASDI benefit amounts
that were not adjusted to reflect 2009 benefit increases, and in some cases,
other prior year benefit increases. These computation errors resulted in monthly
SSI overpayments (including both Federal and State supplemental benefit amounts)
ranging from $2 to $678.

Several factors that contributed to these payment errors are discussed below.

We found that 231 beneficiaries' Supplemental Security Records contained an
Unearned Income Reduction (UMR) indicator code of "Y." This code indicated
that field office staff determined double counting applied, and amounts SSA
withheld from the OASDI payments should not be considered unearned income to
the recipient. However, it also appeared that input of this indicator mistakenly
froze the OASDI benefit amount used in the offset computation during the entire
period SSA recouped overpayments from the beneficiaries via OASDI withholding.
Once SSA input the indicator on the payment record, the unearned income offset
computation no longer considered benefit payment increases awarded to these
beneficiaries. In each of these cases, a smaller OASDI benefit amount was used
in the March 2009 offset computation than the actual current benefit amount
paid to these individuals. Monthly overpayments to these 231 individuals ranged
from $2 to $533 and will continue until the OASDI overpayment withholding stops
and SSA employees remove the UMR indicator codes.

For example, in March 2009, SSA issued a concurrent beneficiary a $647 OASDI
payment and a $528 SSI payment ($123 Federal benefit amount plus a $405 New
York State supplemental benefit amount). However, payment records indicate SSA
erroneously offset the SSI payment using the $443 OASDI benefit amount paid
to this individual in April 2006, instead of the $647 benefit amount SSA actually
paid the beneficiary in March 2009. SSA placed a UMR indicator code "Y"
on this record in April 2006, the same month it began collecting a large overpayment
from this individual via monthly withholding from OASDI benefits. Because of
this error, SSA overpaid this individual every month since implementation of
the 2007 COLA and currently overpays $204 in monthly SSI payments ($124 in Federal
benefits and $80 in New York State supplemental benefits).

We found that 47 beneficiaries' Master Beneficiary Records did not contain
an SSI Data (SID) segment, so the current OASDI benefit amount paid to these
individuals was not reflected in the unearned income offset computation. In
each of these cases, the computation erroneously incorporated either a $0 OASDI
benefit amount or a lower OASDI benefit amount than SSA actually paid the beneficiary.
The monthly overpayments to these 47 individuals ranged from $3 to $678 and
will continue until these errors are corrected. For example, in March 2009,
SSA issued a concurrent beneficiary a $678 SSI payment (a $445 Federal benefit
plus a $233 California State supplemental benefit). SSA's records indicate this
payment was offset by $249 in OASDI benefits. However, SSA actually paid this
beneficiary $1,355 in OASDI benefits-an amount that should have reduced her
SSI payment to $0. SSA's records indicated the $249 amount used in the March
2009 offset computation equaled the OASDI benefit amount SSA initially paid
the beneficiary in 2005. As a result, SSA overpaid this individual $678 in SSI
payments each month during 2009.

Thirty-eight beneficiaries had two different SSNs and received OASDI benefits
under one SSN and SSI payments under the other. These cases were similar to
cases discussed in our report Benefit Payments Mailed to Post Office Boxes.
According to SSA staff, this is a known, but uncorrected, systems error that
occurs when individuals receive both OASDI and SSI under more than one SSN.
Monthly overpayments to these 38 individuals ranged from $5 to $139 and will
continue until the systems error is corrected.

Twelve beneficiaries were overpaid because their payment records contained
a UMR indicator code "Y," no SID line, and/or some other alert indicating
issues. Monthly overpayments to these 12 individuals ranged from $5 to $522
and will continue until the errors are corrected.

Ten beneficiaries' SSI unearned income offset computations used incorrect OASDI
amounts, but based on our review of available information, we could not determine
how or why the errors occurred. Monthly overpayments to these 10 individuals
ranged from $5 to $564 and will continue until the errors are corrected.

On May 20, 2009, we obtained a data extract from all 20 payment record segments
identifying 7,214 payment records where the SSI unearned income offset computation
incorporated OASDI benefit amounts that were less than amounts SSA actually
paid the beneficiaries. We provided these data to SSA Operations staff.

CONCLUSION AND RECOMMENDATIONS

SSA will issue overpayments to about 6,800 concurrently entitled beneficiaries
as a result of an SSI unearned income computation error. SSA computed these
beneficiaries' SSI unearned income offset based on OASDI amounts that had not
been adjusted to reflect recent payment increases. Various errors contributed
to this problem. If these errors are not corrected, we estimate SSA will issue
approximately $5.1 million in excessive SSI payments to these beneficiaries
over the next 12 months. To assist SSA in preventing additional improper payments
to these individuals, we recommend that SSA:

1. Review the 7,214 cases we provided and take appropriate action to correct
the errors and prevent future errors.

2. Take action to correct the system error involving beneficiaries whose SSI
payment record contains a UMR indicator code of "Y" or implement compensating
controls to timely identify and correct these errors on individual payment records.

3. Take action to correct the system error that results in erroneous deletion
of the Supplemental Identification line from the Master Beneficiary Record of
concurrently entitled beneficiaries or implement compensating controls to timely
identify and correct these errors on individual payment records.

4. Take action to correct the system error that prevents accurate computation
of the unearned income offset for concurrently entitled individuals receiving
OASDI benefits under one SSN and SSI payments under a different SSN-or implement
compensating controls to timely identify and correct these errors on individual
payment records.

5. Take action to ensure its records pertaining to individuals assigned multiple
SSNs are appropriately cross-referenced to each other.

AGENCY COMMENTS

SSA agreed with our recommendations. The full text of SSA's comments is included
in Appendix C.

Reviewed applicable sections of the Social Security Act and Social Security
Administration (SSA) regulations, rules, policies, and procedures.
Reviewed relevant reports issued by the Office of the Inspector General.
Reviewed SSA's controls regarding current beneficiaries receiving Cost of Living
Adjustment increases.
Interviewed SSA regional staff regarding Supplemental Security Income (SSI)
computation of unearned income.
Obtained a data extract from 1 payment record segment identifying 495 concurrent
beneficiaries in current payment status (as of March 2009) whose SSI payments
appeared to be offset by Old-Age, Survivors and Disability Insurance (OASDI)
amounts that were less than the monthly benefits SSA actually paid.
We excluded five records from further consideration that belonged to individuals
with multiple Social Security numbers that were identified during our prior
audit Multiple Benefit Payments to Same PO Box Address (A-06-08-18097). During
that audit, we requested SSA take action to correct payment errors to these
five beneficiaries.
We excluded another 152 records from further consideration after determining
unearned income offset computation errors did not actually occur. In most cases,
SSA approved the individuals for disability benefits, but the payments were
not scheduled to begin until after March 2009. These individuals' OASDI payment
records indicated they were in current payment status, which provided the false
indication that the $0 OASDI benefit amount used in the March 2009 SSI unearned
income offset computation was erroneous.
Analyzed payment records pertaining to the remaining 338 beneficiaries.
We tested the data obtained for our audit and determined it was sufficiently
reliable to meet our objective. We performed our audit between April and June
2009 in Dallas, Texas. The entities audited were the field offices and program
service centers under the Deputy Commissioner for Operations; and the Offices
of Retirement and Survivors Insurance Systems, Disability Systems, and Applications
and Supplemental Security Income Systems under the Deputy Commissioner for Systems.
We conducted this performance audit in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable basis for
our findings and conclusions based on our audit objective. We believe the evidence
obtained provides a reasonable basis for our findings and conclusions based
on our audit objective.

Thank you for the opportunity to review and comment on the draft report. We
appreciate OIG's efforts in conducting this review. Attached is our response
to the report recommendations.

Please let me know if we can be of further assistance. Please direct staff
inquiries to Candace Skurnik, Director, Audit Management and Liaison Staff,
at (410) 965-4636.

COMMENTS ON THE OFFICE OF THE INSPECTOR GENERAL'S DRAFT REPORT, "SUPPLEMENTAL
SECURITY INCOME OVERPAYMENTS TO CONCURRENT BENEFICIARIES RESULTING FROM INCORRECT
BENEFIT CALCULATIONS" (A-06-09-29103)

We have reviewed the draft report and our responses to the specific recommendations
are provided below.

Recommendation 1

Review the 7,214 cases provided and take appropriate action to correct the
errors and prevent future errors.

Comment

We agree. By December 2009, we will complete the review of the cases and take
action to correct the errors and to prevent future overpayments.

Recommendation 2

Take action to correct the system error involving beneficiaries whose Supplemental
Security Income (SSI) payment record contains an unearned income reduction indicator
code of "Y" or implement compensating controls to timely identify
and correct these errors on individual payment records.

Comment

We agree. We expect to implement the necessary system correction by the end
of September 2009.

Recommendation 3

Take action to correct the system error that results in erroneous deletion
of the Supplemental Identification line from the Master Beneficiary Record of
concurrently entitled beneficiaries or implement compensating controls to timely
identify and correct these errors on individual payment records.

Comment

We agree. We expect to implement the necessary system correction by the end
of September 2009.

Recommendation 4

Take action to correct the system error that prevents accurate computation
of the unearned income offset for concurrently entitled individuals receiving
Old-Age, Survivors and Disability Insurance benefits under one Social Security
number (SSN) and SSI payments under a different SSN, or implement compensating
controls to timely identify and correct these errors on individual payment records.

Comment

We agree. We expect to implement the necessary system correction by the end
of September 2009.

Recommendation 5

Take action to ensure that our records pertaining to individuals assigned multiple
SSNs are appropriately cross-referenced to each other.

Comment

We agree. We expect to implement the necessary system correction by the end
of September 2009.

For additional copies of this report, please visit our web site at www.ssa.gov/oig
or contact the Office of the Inspector General's Public Affairs Staff Assistant
at
(410) 965-4518. Refer to Common Identification Number A-06-09-29103.

Overview of the Office of the Inspector General
The Office of the Inspector General (OIG) is comprised of an Office of Audit
(OA), Office of Investigations (OI), Office of the Counsel to the Inspector
General (OCIG), Office of External Relations (OER), and Office of Technology
and Resource Management (OTRM). To ensure compliance with policies and procedures,
internal controls, and professional standards, the OIG also has a comprehensive
Professional Responsibility and Quality Assurance program.

Office of Audit
OA conducts financial and performance audits of the Social Security Administration's
(SSA) programs and operations and makes recommendations to ensure program objectives
are achieved effectively and efficiently. Financial audits assess whether SSA's
financial statements fairly present SSA's financial position, results of operations,
and cash flow. Performance audits review the economy, efficiency, and effectiveness
of SSA's programs and operations. OA also conducts short-term management reviews
and program evaluations on issues of concern to SSA, Congress, and the general
public.

Office of Investigations
OI conducts investigations related to fraud, waste, abuse, and mismanagement
in SSA programs and operations. This includes wrongdoing by applicants, beneficiaries,
contractors, third parties, or SSA employees performing their official duties.
This office serves as liaison to the Department of Justice on all matters relating
to the investigation of SSA programs and personnel. OI also conducts joint investigations
with other Federal, State, and local law enforcement agencies.

Office of the Counsel to the Inspector General
OCIG provides independent legal advice and counsel to the IG on various matters,
including statutes, regulations, legislation, and policy directives. OCIG also
advises the IG on investigative procedures and techniques, as well as on legal
implications and conclusions to be drawn from audit and investigative material.
Also, OCIG administers the Civil Monetary Penalty program.

Office of External Relations
OER manages OIG's external and public affairs programs, and serves as the principal
advisor on news releases and in providing information to the various news reporting
services. OER develops OIG's media and public information policies, directs
OIG's external and public affairs programs, and serves as the primary contact
for those seeking information about OIG. OER prepares OIG publications, speeches,
and presentations to internal and external organizations, and responds to Congressional
correspondence.

Office of Technology and Resource Management
OTRM supports OIG by providing information management and systems security.
OTRM also coordinates OIG's budget, procurement, telecommunications, facilities,
and human resources. In addition, OTRM is the focal point for OIG's strategic
planning function, and the development and monitoring of performance measures.
In addition, OTRM receives and assigns for action allegations of criminal and
administrative violations of Social Security laws, identifies fugitives receiving
benefit payments from SSA, and provides technological assistance to investigations.